On November 2, the Internal Revenue Service (“IRS”) issued the most significant new guidance (the “proposed regulations”) in 23 years relating to the taxation of foreign governments, including sovereign wealth funds ("SWFs"). At the time most of the previous regulations were issued, there were relatively few SWFs in existence and the nature of their investments was generally limited to investments in their own countries' stocks, bonds and real estate with only occasional investments in similar assets outside of their own countries.